A biotech company known for its cancer treatment drugs, Exelixis Inc. (EXEL), has long sought ways to enhance its bottom line. In the immediate future, the primary goals of biotech are to reduce costs and expand the use of medications already in existence.
While Exelixis has three approved products on the market, the company has not demonstrated to investors the ability to generate steady revenue and profits. It’s still possible for Exelixis to raise sales of existing products, which will increase profit margins.
The FDA extended the indications for Cabometyx (previously only available for treating medullary thyroid cancer) at the end of January this year. Cabometyx can now be taken along with Bristol Myers Squibb’s Opdivo to treat first-line renal cell carcinoma (RCC). In addition to this new revenue stream over the next few years, the company also plans on pursuing clinical trials for at least seven other additional indications. Six of the seven tests are already in Phase III. The company plans to submit regulatory filings to commercialize at least three of these six trials in 2021.
Over the last three years, Cabometyx provided Exelixis Inc. (EXEL) with more than 45 % revenue growth. Exelixis expects to grow revenue to $1.25 billion this year.
Exelixis faces profitability challenges, as discussed above. According to the company, selling, general and administrative expenses (SG&A) rose 63 % year over year. The total operating expenses increased by over 58%. As a result, key employees and managers have received higher compensation payments from shareholders. In other words, Exelixis’s profitability depends on cost control.
Exelixis Inc. (EXEL) Shares were rising 0.53% to trade at $24.46 in the current market at the last check. The previous session closed at $24.33 for EXEL. 1.52 million shares were sold, which was lower than the 1.65 million shares traded on average in the past 50 days. In the past week, EXEL shares have declined by 4.30%, and they have fallen -0.65% in the past 12 months. Over the past three and six months, the stock has risen by 11.13% and 27.03 %, respectively. Additionally, the company has a market value of $7.62 billion and an outstanding share count of 312.42 million.